Changing payment trends: online to offline? Offline to online?

Written by Shogo Tsuji, Internal research team,
28 Feb 2020, 4 minutes


Since the dot com era in the 1990’s, businesses have set their eyes on setting up online presence; changing the way merchants engage with consumers and simplifying the way consumers purchase across the globe.

Before consumers buy something at brick-and-mortar stores, consumers will perform some research for the product on the internet. Similarly, after you happen to see the product that caught your interest in a store, you might find out more on the internet.

These consumer trends blurred the lines between online and offline engagements; and some businesses made use of these trends as their main strategy.

Here’s what you may not know about O2O and O2O2O.

What are O2O and O2O2O?

Firstly, let us identify these strategies; which are commonly identified as O2O and O2O2O strategies.

O2O is generally known as an offline to online strategy where a business directs its physical store customers to their online stores. It can also be identified as an online to offline strategy where the process is reversed, bringing online customers into physical stores.

O2O2O represents the strategy that directs consumers between offline and online stores. One of the biggest merits of this strategy is that you can see the impact of your promotion. Let’s say, you issue discount coupons online such as your store’s website, your social media channel or a mobile app. You could monitor how many of your coupons have been collected and redeemed.

Where are the consumer spending trends these days? Online or offline?

The estimated total retail sales volume in Singapore for the month of November 2019 was about $3.6 billion, which fell 4.0% year-to-year. However, online retail sales made up an estimated 8.0%, which increased by 1.4% compared to November 2018.

On the other hand, global online sales for the F&B industry is expected to make up nearly 20% of the overall sales receipt in the future.

Therefore, it could be said that offline is still a dominant channel in both industries, but the presence of online sales in the retail industry is growing steadily.

So, which strategy should your business adopt?

Even though businesses have changed the way they engage consumers, they will always be affected by global events such as natural disasters, terrorist activities and virus outbreaks.

In the post-September 11 periods, airline travel and online booking frequency declined sharply; and the ongoing COVID-19 outbreak greatly affected businesses in the retail and hospitality industry across Southeast Asia.

Some of these industries such as delivery services and online meeting platforms observed an increase in demand as consumers avoid crowds.

In order to enjoy the benefits of these strategies, it is necessary to understand the nature of your business and industry before deciding which strategy to implement.

Take for example Platinum yoga, a Singapore based business which offers yoga classes, installed online marketing online payment methods to streamline their operations. Because of this, customers can sign up for lessons and make purchases through their website and visit their studio to attend the lessons.

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